WASHINGTON -- With Congress down to what may be its final two weeks of work for this year, state and local issuers are making a last-ditch attempt to get lawmakers to enact a tax simplification bill containing several provisions that would benefit tax-exempt bonds.
The bill in question was passed by the House Ways and Means Committee in November 1993 and by the full House last May, but has !anguished in the Senate since then.
"We appreciate the time constraints under which you are operating, but we call your attention to these important simplification measures and urge their enactment this year," said the letter, sent Friday to all senators and signed by the Government Finance Officers Association, the National League of Cities, and the National Association of Counties.
Also signing the letter were the National Association of State Treasurers, the U.S. Conference of Mayors, the American Public Power Association, and the National School Boards Association.
One of the bond provisions would ease requirements for bona fide debt service funds under the 1989 arbitrage rebate relief law. Another would clarify that transactions in which state or local governments prepay equipment purchases are eligible for tax-exempt financing if certain conditions are met.
A third provision would expand the six-month exemption from the arbitrage rebate requirement to an issuer that spends 95% of proceeds within that period and spends the other 5% in the following six months.
The bond provisions need to be enacted "because they provide relief from overly burdensome federal regulations that increase the cost of facilities financed by tax-exempt bonds," the letter said.
Lobbyists have said chances for passage of the bill this late in the legislative session are slim because the Senate Finance Committee has yet to draft its version of the simplification bill. The panel has been preoccupied with other issues, including health care reform, the Superfund bill, and legislation to ratify the General Agreement on Tariffs and Trade.